Promise of hundreds of jobs in Holtec move to Camden

By Julia Terruso and Maddie Hanna, Inquirer Staff Writers

Posted: July 11, 2014

A proposal to award a manufacturing company $260 million in tax breaks - one of the largest such subsidies in recent years - could produce more than 400 jobs in Camden, individuals familiar with the deal said Wednesday.

Holtec International Inc., with corporate headquarters in Evesham and another base in Jupiter, Fla., is said to be looking to locate some operations at the city's port if the deal goes through.

The company, which supplies power-plant equipment, has set its sights on growing from 750 employees to thousands through product expansion in coming years.

New Jersey's Economic Development Authority is to vote Thursday on granting Holtec the subsidy over 10 years. The incentive trails only that for the Revel Casino, which received $261.4 million in 2011, and American Dream Meadowlands, an entertainment and shopping mall complex in East Rutherford that was approved last year for $390 million.

The vote comes a month after the agency awarded $82 million in tax credits over a decade to the 76ers to build a practice facility and offices on Camden's waterfront.

The two Camden packages were made possible by the Economic Opportunity Act of 2013, which expanded the availability of business tax incentives statewide, but has special provisions to benefit South Jersey - Camden in particular.

"The reality is, the incentive program was designed to work this way," said Assembly Majority Leader Louis D. Greenwald (D., Camden). "A lot of people thought there was never enough you could do" to help Camden. The recent deals, he said, show that "Camden is back."

Three individuals with knowledge of the specifics of the Holtec proposal said the company would construct a facility that would create at least 400 permanent skilled and unskilled manufacturing jobs in the city.

They spoke on condition of anonymity because they were not authorized to discuss the project publicly ahead of the development authority vote.

Company and other officials have declined to comment prior to the vote.

Holtec's founder, Krishna P. Singh, who has an engineering doctorate from the University of Pennsylvania, has grown the company from 180 staff and $90 million in power-plant-component sales in 2006 to 750 employees and an expected $500 million in sales this year, according to the company. Holtec specializes in, among other things, equipment for the storage of spent nuclear fuel rods that allow plants to keep the rods on site.

Evesham Mayor Randy Brown said he had no knowledge of the company's latest plans. "We just renamed the road outside Holtec Way," Brown said. "We love having them in town, and we hope they keep a presence here."

Singh is a member of the board of trustees of Cooper University Hospital in Camden, whose chairman is George E. Norcross III, the powerful South Jersey Democratic leader. Norcross is a member of the board of directors of Holtec and a former co-owner of The Inquirer. Singh is also a former co-owner of The Inquirer. He sold his share of the newspaper company to Norcross, who earlier this year sold out his interest.

On Wednesday, the project elicited praise and concern, though few details were known to the public because the development authority does not release project summaries until the day of its meeting.

Jonathan Whiten, deputy director of New Jersey Policy Perspective, which published a report last month critical of the state's surge in business tax subsidies, questioned whether the city would see direct benefits.

"I think the question is, is it really a good trade-off?" Whiten said. "And would this have likely happened anyway? Sometimes, you do see the tax break as the driving decision, but more often than not, it's just one piece of the puzzle, and it's not necessary to give away the whole store."

The development authority determines how a company will benefit the state based on a 35-year projection, despite the businesses' being required to stay for only 15 years. "The economy changes a lot in 35 years, and there's no penalty if a company leaves once the tax break is up," Whiten said. "It's a shaky thing to do."

Sen. Raymond J. Lesniak (D., Union), a sponsor of the 2013 incentives overhaul, said that while Camden "cannot be economically viable without a tax incentive program such as this," he wanted to ensure that such deals do not become politicized.

While the Sixers deal has been attacked as overly generous, Assembly Minority Leader Jon Bramnick (R., Union) said the criticism was misplaced. The team will not receive the benefits until it creates the jobs it promised, Bramnick said. The Sixers have promised to locate 250 jobs in Camden.

"It's not like all of a sudden we pull up a truck and give them $82 million," Bramnick said.

Opponents say the credits mean taxpayers will end up shouldering greater costs.

"We don't think it's right that the vast majority of businesses don't get a tax break, the vast majority of residents don't get a tax break," said Mike Proto, communications director for the New Jersey chapter of Americans for Prosperity, a conservative advocacy group.